NEWS

Summertime Blues
(Posted 1st July 2010)

Well, there we have it - the first Coalition Budget. Despite Opposition and Union reaction, this was all to be expected and there were no major surprises (for me anyway). I was disappointed though.

Firstly, the problem of bank lending to small businesses has still not been addressed. The banks MUST lend, and lend at affordable rates, if the little guys are to survive. This will become even more crucial because, and I report this with a heavy heart, new draconian HMRC penalties are now in place. In the Budget papers, HMRC said they would use external agencies to accelerate the collection of outstanding debts, so if we couple that with the banks' unwillingness to lend, we have a bloodbath just waiting to happen.

Secondly, and apologies for the technical blah, but Entrepreneurs Relief for CGT needs modifying and wasn't. The 10% rate of CGT is very much like the old retirement relief in that you have to sell most of the business, not just the asset itself, to claim the relief. Well, what if, for example, you want to sell a business freehold used to repay a bank debt and you move to a rented property. Well, you have not sold the business itself and will there NOT be entitled to the 10% rate. Nightmare.

Was there any good news? No. Is there any good news? No. But the £ has started to improve against the €, so just maybe the international markets think that GB Ltd has started to do the right thing.